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Types of Staffing Strategy

19 January, 2016 - 15:28

There are three main staffing strategies a company can implement when entering an overseas market, with each having its advantages and disadvantages. The first strategy is a home-country national strategy. This staffing strategy uses employees from the home country to live and work in the country. These individuals are called expatriates. The second staffing strategy is a host-country national strategy, which means to employ people who were born in the country in which the business is operating. Finally, a third-country national strategy means to employee people from an entirely different country from the home country and host country. Table 14.4 lists advantages and disadvantages of each type of staffing strategy. Whichever strategy is chosen, communication with the home office and strategic alignment with overseas operations need to occur for a successful venture.

Table 14.4 Advantages and Disadvantages of the Three Staffing Strategies

Home-Country National

Host-Country National

Third-Country National


Greater control of organization

Language barrier is eliminated

The third-country national may be better equipped to bring the international perspective to the business

Managers gain experience in local markets

Possible better understanding of local rules and laws

Costs associated with hiring such as visas may be less expensive than with home-country nationals

Possible greater understanding and implementation of business strategy

Hiring costs such as visas are eliminated

Cultural understanding

Morale builder for employees of host country


Adapting to foreign environment may be difficult for manager and family, and result in less productivity

Host-country manager may not understand business objectives as well without proper training

Must consider traditional national hostilities

Expatriate may not have cultural sensitivity

May create a perception of “us” versus “them”

The host government and/or local business may resent hiring a third-country national

Language barriers

Can affect motivation of local workers

Cost of visa and hiring factors


Human Resource Recall

Compare and contrast a home-country versus a host-country staffing strategy.